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Finance Receivables (Tables)
 6 Months Ended
Jun. 30, 2020
Receivables [Abstract]  
Summary of finance receivables included in the Consolidated Statements of Financial Position
A summary of finance receivables included in the Consolidated Statements of Financial Position was as follows:
(Millions of dollars)
 
June 30,
2020
 
December 31,
2019
Retail loans, net(1)
 
$
15,063

 
$
15,424

Retail leases, net
 
7,466

 
7,660

Caterpillar purchased receivables, net
 
3,514

 
4,448

Wholesale loans, net(1)
 
773

 
664

Wholesale leases, net
 
40

 
60

Total finance receivables
 
26,856

 
28,256

Less: Allowance for credit losses
 
(515
)
 
(424
)
Total finance receivables, net
 
$
26,341


$
27,832

 
 
 
 
 

(1) Includes failed sale leasebacks.
Allowance for credit losses and total finance receivables
An analysis of the allowance for credit losses was as follows:
(Millions of dollars)
June 30, 2020
Allowance for Credit Losses:
Customer
 
Dealer
 
Caterpillar
Purchased
Receivables
 
Total
Balance at beginning of year
$
375

 
$
45

 
$
4

 
$
424

Adjustment to adopt new accounting guidance(1)
12

 
—

 
—

 
12

Receivables written off
(73
)
 
—

 
—

 
(73
)
Recoveries on receivables previously written off
13

 
—

 
—

 
13

Provision for credit losses
146

 
—

 
(1
)
 
145

Foreign currency translation adjustment
(6
)
 
—

 
—

 
(6
)
Balance at end of period
$
467

 
$
45

 
$
3

 
$
515

 
 
 
 
 
 
 
 
Individually evaluated
$
184

 
$
39

 
$
—

 
$
223

Collectively evaluated
283

 
6

 
3

 
292

Ending Balance
$
467

 
$
45

 
$
3

 
$
515

 
 
 
 
 
 
 
 
Finance Receivables:
 

 
 

 
 

 
 

Individually evaluated
$
601

 
$
78

 
$
—

 
$
679

Collectively evaluated
18,538

 
4,125

 
3,514

 
26,177

Ending Balance
$
19,139

 
$
4,203

 
$
3,514

 
$
26,856

 
 
 
 
 
 
 
 
(1) See Note 2 regarding new accounting guidance related to credit losses.

(Millions of dollars)
December 31, 2019
Allowance for Credit Losses:
Customer
 
Dealer
 
Caterpillar
Purchased
Receivables
 
Total
Balance at beginning of year
$
486

 
$
21

 
$
4

 
$
511

Receivables written off
(281
)
 
—

 
—

 
(281
)
Recoveries on receivables previously written off
44

 
—

 
—

 
44

Provision for credit losses
138

 
24

 
—

 
162

Adjustment due to sale of receivables
(11
)
 
—

 
—

 
(11
)
Foreign currency translation adjustment
(1
)
 
—

 
—

 
(1
)
Balance at end of year
$
375

 
$
45

 
$
4

 
$
424

 
 
 
 
 
 
 
 
Individually evaluated
$
178

 
$
39

 
$
—

 
$
217

Collectively evaluated
197

 
6

 
4

 
207

Ending Balance
$
375

 
$
45

 
$
4

 
$
424

 
 
 
 
 
 
 
 
Finance Receivables:
 

 
 

 
 

 
 

Individually evaluated
$
594

 
$
78

 
$
—

 
$
672

Collectively evaluated
18,770

 
4,366

 
4,448

 
27,584

Ending Balance
$
19,364

 
$
4,444

 
$
4,448

 
$
28,256

 
 
 
 
 
 
 
 
Amortized cost of finance receivables in the Customer portfolio segment by origination year
The table below summarizes the aging category of our amortized cost of finance receivables in the Customer portfolio segment by origination year.
(Millions of dollars)
June 30, 2020
 
2020
 
2019
 
2018
 
2017
 
2016
 
Prior
 
Revolving
Finance
Receivables
 
Total
Finance
Receivables
North America
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
$
1,863

 
$
3,035

 
$
1,836

 
$
814

 
$
374

 
$
97

 
$
102

 
$
8,121

31-60 days past due
13

 
28

 
20

 
15

 
5

 
2

 
—

 
83

61-90 days past due
4

 
15

 
14

 
8

 
3

 
1

 
—

 
45

91+ days past due
3

 
24

 
31

 
19

 
15

 
6

 
—

 
98

EAME
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
545

 
1,104

 
727

 
336

 
113

 
33

 
—

 
2,858

31-60 days past due
5

 
13

 
12

 
5

 
2

 
—

 
—

 
37

61-90 days past due
6

 
7

 
2

 
2

 
—

 
—

 
—

 
17

91+ days past due
—

 
11

 
14

 
15

 
51

 
62

 
—

 
153

Asia/Pacific
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
790

 
1,153

 
609

 
195

 
50

 
20

 
29

 
2,846

31-60 days past due
4

 
22

 
18

 
5

 
—

 
—

 
—

 
49

61-90 days past due
2

 
11

 
8

 
3

 
—

 
—

 
—

 
24

91+ days past due
1

 
19

 
18

 
5

 
1

 
—

 
—

 
44

Mining
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
213

 
655

 
375

 
236

 
124

 
190

 
270

 
2,063

31-60 days past due
—

 
—

 
13

 
5

 
—

 
—

 
—

 
18

61-90 days past due
—

 
1

 
3

 
—

 
—

 
—

 
—

 
4

91+ days past due
—

 
12

 
3

 
25

 
—

 
—

 
1

 
41

Latin America
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
286

 
440

 
214

 
74

 
22

 
27

 
—

 
1,063

31-60 days past due
2

 
6

 
8

 
1

 
1

 
1

 
—

 
19

61-90 days past due
—

 
3

 
9

 
5

 
1

 
—

 
—

 
18

91+ days past due
—

 
19

 
40

 
29

 
8

 
6

 
—

 
102

Caterpillar Power Finance
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current
106

 
279

 
172

 
278

 
119

 
143

 
134

 
1,231

31-60 days past due
—

 
—

 
2

 
—

 
—

 
—

 
—

 
2

61-90 days past due
—

 
—

 
—

 
—

 
—

 
2

 
—

 
2

91+ days past due
—

 
—

 
20

 
13

 
33

 
135

 
—

 
201

Total
$
3,843

 
$
6,857

 
$
4,168

 
$
2,088

 
$
922

 
$
725

 
$
536

 
$
19,139

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Aging related to finance receivables
The table below summarizes the aging category of our amortized cost of finance receivables in the Caterpillar Purchased Receivables portfolio segment.
(Millions of dollars)
 
 
 
 
 
 
 
 
 
 
 
 
June 30, 2020
 
31-60
Days
Past Due
 
61-90
Days
Past Due
 
91+
Days
Past Due
 
Total
Past Due
 
Current
 

Total Finance
Receivables
North America
$
15

 
$
8

 
$
16

 
$
39

 
$
1,789

 
$
1,828

EAME
1

 
—

 
1

 
2

 
633

 
635

Asia/Pacific
2

 
—

 
1

 
3

 
579

 
582

Mining
—

 
—

 
—

 
—

 
—

 
—

Latin America
1

 
—

 
—

 
1

 
459

 
460

Caterpillar Power Finance
2

 
—

 
1

 
3

 
6

 
9

Total
$
21

 
$
8

 
$
19

 
$
48

 
$
3,466

 
$
3,514

 
 
 
 
 
 
 
 
 
 
 
 

The table below summarizes our recorded investment in finance receivables by aging category.
(Millions of dollars)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2019
 
31-60
Days
Past Due
 
61-90
Days
Past Due
 
91+
Days
Past Due
 
Total
Past Due
 
Current
 

Total Finance
Receivables
Customer
 

 
 

 
 

 
 
 
 
 
 
North America
$
72

 
$
23

 
$
55

 
$
150

 
$
8,085

 
$
8,235

EAME
30

 
31

 
141

 
202

 
2,882

 
3,084

Asia/Pacific
40

 
14

 
29

 
83

 
2,733

 
2,816

Mining
5

 
—

 
19

 
24

 
2,266

 
2,290

Latin America
41

 
23

 
80

 
144

 
1,131

 
1,275

Caterpillar Power Finance
10

 
10

 
225

 
245

 
1,419

 
1,664

Dealer
 

 
 

 
 

 
 
 
 
 
 
North America
—

 
—

 
—

 
—

 
2,514

 
2,514

EAME
—

 
—

 
—

 
—

 
600

 
600

Asia/Pacific
—

 
—

 
—

 
—

 
487

 
487

Mining
—

 
—

 
—

 
—

 
4

 
4

Latin America
—

 
—

 
78

 
78

 
758

 
836

Caterpillar Power Finance
—

 
—

 
—

 
—

 
3

 
3

Caterpillar Purchased Receivables
 

 
 

 
 

 
 
 
 
 
 
North America
15

 
6

 
18

 
39

 
2,450

 
2,489

EAME
1

 
—

 
2

 
3

 
574

 
577

Asia/Pacific
1

 
—

 
—

 
1

 
891

 
892

Mining
—

 
—

 
—

 
—

 
—

 
—

Latin America
—

 
—

 
—

 
—

 
475

 
475

Caterpillar Power Finance
—

 
—

 
—

 
—

 
15

 
15

Total
$
215

 
$
107

 
$
647

 
$
969

 
$
27,287

 
$
28,256

 
 
 
 
 
 
 
 
 
 
 
 
Impaired finance receivables
In our Customer portfolio segment, impaired finance receivables and the related unpaid principal balances and allowance were as follows:
(Millions of dollars)
 
 
 
 
 
 
As of December 31, 2019
Impaired Finance Receivables With
No Allowance Recorded
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
North America
$
6

 
$
6

 
$
—

EAME
—

 
—

 
—

Asia/Pacific
—

 
—

 
—

Mining
22

 
22

 
—

Latin America
8

 
8

 
—

Caterpillar Power Finance
58

 
58

 
—

Total
$
94

 
$
94

 
$
—

Impaired Finance Receivables With
An Allowance Recorded
 

 
 

 
 

North America
$
30

 
$
30

 
$
11

EAME
61

 
61

 
29

Asia/Pacific
8

 
8

 
2

Mining
37

 
36

 
9

Latin America
58

 
58

 
20

Caterpillar Power Finance
306

 
319

 
107

Total
$
500

 
$
512

 
$
178

Total Impaired Finance Receivables
 

 
 

 
 

North America
$
36

 
$
36

 
$
11

EAME
61

 
61

 
29

Asia/Pacific
8

 
8

 
2

Mining
59

 
58

 
9

Latin America
66

 
66

 
20

Caterpillar Power Finance
364

 
377

 
107

Total
$
594

 
$
606

 
$
178

 
 
 
 
 
 

 
(Millions of dollars)
 
 
 
 
 
 
 
 
Three Months Ended
June 30, 2019
 
Six Months Ended
June 30, 2019
Impaired Finance Receivables With
No Allowance Recorded
Average
Recorded
Investment
 
Interest
Income
Recognized
 
Average
Recorded
Investment
 
Interest
Income
Recognized
North America
$
10

 
$
—

 
$
10

 
$
—

EAME
1

 
—

 
1

 
—

Asia/Pacific
—

 
—

 
—

 
—

Mining
29

 
1

 
30

 
1

Latin America
20

 
1

 
23

 
1

Caterpillar Power Finance
41

 
—

 
51

 
1

Total
$
101

 
$
2

 
$
115

 
$
3

Impaired Finance Receivables With
An Allowance Recorded
 

 
 

 
 

 
 

North America
$
35

 
$
—

 
$
37

 
$
1

EAME
94

 
—

 
94

 
1

Asia/Pacific
9

 
—

 
8

 
—

Mining
39

 
—

 
42

 
1

Latin America
74

 
2

 
75

 
3

Caterpillar Power Finance
443

 
4

 
446

 
7

Total
$
694

 
$
6

 
$
702

 
$
13

Total Impaired Finance Receivables
 

 
 

 
 

 
 

North America
$
45

 
$
—

 
$
47

 
$
1

EAME
95

 
—

 
95

 
1

Asia/Pacific
9

 
—

 
8

 
—

Mining
68

 
1

 
72

 
2

Latin America
94

 
3

 
98

 
4

Caterpillar Power Finance
484

 
4

 
497

 
8

Total
$
795

 
$
8

 
$
817

 
$
16

 
 
 
 
 
 
 
 
Finance receivables on non-accrual status
In our Customer portfolio segment, finance receivables which were on non-accrual status and finance receivables over 90 days past due and still accruing income were as follows:
(Millions of dollars)
June 30, 2020
 
Amortized Cost
 
Non-accrual
With an
Allowance
 
Non-accrual
Without an
Allowance
 
91+ Still
Accruing
North America
$
78

 
$
1

 
$
30

EAME
168

 
—

 
5

Asia/Pacific
32

 
—

 
12

Mining
43

 
—

 
—

Latin America
106

 
3

 
2

Caterpillar Power Finance
302

 
21

 
—

Total
$
729

 
$
25

 
$
49

 
 
 
 
 
 
    
There was $1 million and $5 million of interest income recognized during the three and six months ended June 30, 2020, respectively, for customer finance receivables on non-accrual status.

(Millions of dollars)
December 31, 2019
 
Recorded Investment
 
Non-accrual
Finance
Receivables
 
91+ Still
Accruing
North America
$
44

 
$
15

EAME
165

 
4

Asia/Pacific
21

 
8

Mining
47

 
—

Latin America
89

 
2

Caterpillar Power Finance
361

 
—

Total
$
727

 
$
29

 
 
 
 
Finance receivables modified as TDRs
Finance receivables in the Customer portfolio segment modified as TDRs were as follows:
(Dollars in millions)
Three Months Ended
June 30, 2020
 
Three Months Ended
June 30, 2019
 
Number of
Contracts
 
Pre-TDR
Amortized
Cost
 
Post-TDR
Amortized
Cost
 
Number of
Contracts
 
Pre-TDR
Recorded
Investment
 
Post-TDR
Recorded
Investment
North America
10

 
$
9

 
$
9

 
8

 
$
5

 
$
4

EAME
—

 
—

 
—

 
2

 
10

 
10

Asia/Pacific(1)
104

 
8

 
8

 
—

 
—

 
—

Mining(2)
40

 
17

 
17

 
1

 
6

 
6

Latin America
1

 
—

 
—

 
4

 
2

 
2

Caterpillar Power Finance
6

 
37

 
37

 
7

 
47

 
47

Total
161

 
$
71

 
$
71

 
22

 
$
70

 
$
69

 
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
June 30, 2020
 
Six Months Ended
June 30, 2019
 
Number of
Contracts
 
Pre-TDR
Amortized
Cost
 
Post-TDR
Amortized
Cost
 
Number of
Contracts
 
Pre-TDR
Recorded
Investment
 
Post-TDR
Recorded
Investment
North America
10

 
$
9

 
$
9

 
8

 
$
5

 
$
4

EAME
—

 
—

 
—

 
19

 
17

 
17

Asia/Pacific
104

 
8

 
8

 
—

 
—

 
—

Mining
40

 
17

 
17

 
1

 
6

 
6

Latin America
6

 
2

 
2

 
4

 
2

 
2

Caterpillar Power Finance
6

 
37

 
37

 
15

 
98

 
97

Total
166

 
$
73

 
$
73

 
47

 
$
128

 
$
126

 
 
 
 
 
 
 
 
 
 
 
 

(1) In Asia/Pacific, during the three months ended June 30, 2020, 104 contracts with a pre-TDR amortized cost of $8 million and a post-TDR amortized cost of $8 million were related to four customers.
(2) In Mining, during the three months ended June 30, 2020, 40 contracts with a pre-TDR amortized cost of $17 million and a post-TDR amortized cost of $17 million were related to two customers.

TDRs in the Customer portfolio segment with a payment default (defined as 91+ days past due) which had been modified within twelve months prior to the default date, were as follows:
(Dollars in millions)
Three Months Ended
June 30, 2020
 
Three Months Ended
June 30, 2019
 
Number of
Contracts
 
Post-TDR
Amortized
Cost
 
Number of
Contracts
 
Post-TDR
Recorded
Investment
North America
1

 
$
—

 
—

 
$
—

Total
1

 
$
—

 
—

 
$
—

 
 
 
 
 
 
 
 
 
Six Months Ended
June 30, 2020
 
Six Months Ended
June 30, 2019
 
Number of
Contracts
 
Post-TDR
Amortized
Cost
 
Number of
Contracts
 
Post-TDR
Recorded
Investment
North America
1

 
$
—

 
—

 
$
—

EAME
2

 
10

 
—

 
—

Latin America
3

 
1

 
—

 
—

Total
6

 
$
11

 
—

 
$
—